Knowledge Partners

January 08, 2004

"Offshoring can rescue the US software industry"

One of the key problems facing US software companies is lack of innovation, according to George Gilbert and Rahul Sood, principals at Tech Strategy Partners. Innovation is being "strangled" due to insufficient R&D budgets on the company side and an overspending hangover on the customer side, they say in a recent CNET News.com. "Offshore development can help on both fronts," they claim.

The authors point out that as software companies mature, innovation tapers off and grunt work multiplies. By leaving the grunt work--"work that lends itself to a standardized development process" in more politically correct language--to offshore companies, US developers can focus on more creative and innovative programing. "American developers have a passion for innovation. They are more interested in pushing the state of the art in design and functionality," the authors say.

The authors argue that using offshore labor will help US software companies improve the quality of their software. "US companies are forced to compromise on quality to meet deadlines and to focus on more creative tasks. The result is a surge of post-release bugs discovered by customers. Offshore companies, who have grown up testing other people's code, have invested in more advanced testing methodologies than most US companies," they say.